Glanbia plc has announced this morning a joint venture with its co-operative society in respect of its dairy processing business, Dairy Ingredients Ireland.
It's a 40/60 venture with the co-operative taking majority control, it's subject to contracts and approval.
The move is part of the company's preparation for 2015 when milk quotas come to an end.
The co-operative society has announced that it intends to seek member approval to reduce its shareholding in Glanbia plc from just over 50% to 41.4%.
Shares in the company rose 1.67% to €6.10 in early trade following the announcement.
Half year results show revenues up almost 6% to over €1.4 billion, while profits stood at €101.7m. The outlook for the rest of the year is positive and the group has upgraded its guidance to between 8% and 10% growth in adjusted earnings per share.
Glanbia CEO John Moloney said that he was very pleased with the results.The CEO said that the company was pleased with the performance of its nutritionals business and with results in the US and Ireland.
In a statement released to the Irish Stock Exchange the company said that Dairy Ingredients Ireland is the largest dairy processor in Ireland assembling a milk pool of 1.6 billion litres and processing it into 180,000 tonnes of dairy ingredients largely for export to over 50 countries world-wide.
With regard to the joint venture, the statement says that "there is a compelling strategic logic for the creation of the joint venture for both parties as it facilitates the expansion of dairy processing in Ireland in advance of EU milk quota abolition in 2015."
The statement says that it will also ensure that Glanbia's financial resources are directed towards business segments that deliver the highest return on capital for all shareholders.
